# Can a Deviation Threshold Be Bypassed by a Flash Loan Attack? ⎊ Path

**Published:** 2025-12-05
**Author:** Greeks.live
**Categories:** Path

---

## Can a Deviation Threshold Be Bypassed by a Flash Loan Attack?

Yes, a deviation threshold can be bypassed by a flash loan attack if the attacker can use the loaned funds to cause a price movement that exceeds the threshold. The attacker manipulates the price on a low-liquidity exchange, forcing the oracle to submit a new, false price.

They then use this false price to profit from the vulnerable smart contract before repaying the flash loan. Robust oracles mitigate this by using a multi-source index price.

- [Can a Flash Loan Be Used to Manipulate a Decentralized Futures Platform’s Funding Rate?](https://learn.greeks.live/path/can-a-flash-loan-be-used-to-manipulate-a-decentralized-futures-platforms-funding-rate/)

- [How Does a DEX Determine the Optimal Price Deviation Threshold for a “Push” Update?](https://learn.greeks.live/path/how-does-a-dex-determine-the-optimal-price-deviation-threshold-for-a-push-update/)

- [How Can a Flash Loan Attack Exploit a Vulnerable Oracle Used by an Options Protocol?](https://learn.greeks.live/path/how-can-a-flash-loan-attack-exploit-a-vulnerable-oracle-used-by-an-options-protocol/)

- [How Does a Flash Loan Attack Specifically Target a Single-Point Settlement Price?](https://learn.greeks.live/path/how-does-a-flash-loan-attack-specifically-target-a-single-point-settlement-price/)

- [How Does a Flash Loan Facilitate an Oracle Manipulation Attack on a DeFi Protocol?](https://learn.greeks.live/path/how-does-a-flash-loan-facilitate-an-oracle-manipulation-attack-on-a-defi-protocol/)

- [What Is a ‘Flash Loan Attack’ and How Does It Exploit DEX Protocols?](https://learn.greeks.live/path/what-is-a-flash-loan-attack-and-how-does-it-exploit-dex-protocols/)

- [What Is a “Deviation Threshold” and How Does It Prevent Stale Prices?](https://learn.greeks.live/path/what-is-a-deviation-threshold-and-how-does-it-prevent-stale-prices/)

- [How Does a ‘Deviation Threshold’ Affect a Data Feed Update?](https://learn.greeks.live/path/how-does-a-deviation-threshold-affect-a-data-feed-update/)

## Glossar

### [Deviation Threshold](https://learn.greeks.live/area/deviation-threshold/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Constraint ⎊ Deviation Threshold functions as a critical constraint within oracle systems, defining the maximum permissible percentage difference between the current on-chain price and a newly calculated aggregate off-chain price.

### [Threshold](https://learn.greeks.live/area/threshold/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Barrier ⎊ A threshold, within cryptocurrency derivatives and options trading, fundamentally represents a price level that must be breached for a contract to become active or trigger a specific outcome.

### [Deviation](https://learn.greeks.live/area/deviation/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Variance ⎊ Deviation, within cryptocurrency, options, and derivatives, represents the squared difference between an observed value and its expected value, quantifying the dispersion of potential outcomes around a central tendency.

### [Flash Loan](https://learn.greeks.live/area/flash-loan/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Mechanism ⎊ A flash loan is a unique, uncollateralized loan mechanism in decentralized finance that allows users to borrow assets for a very short duration, typically within a single blockchain transaction.

### [Flash Loan Attack](https://learn.greeks.live/area/flash-loan-attack/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Exploitation ⎊ A flash loan attack represents a market manipulation technique enabled by decentralized finance (DeFi) protocols, specifically leveraging the ability to borrow substantial capital without collateral requirements, contingent upon full repayment within a single transaction block.

## Discover More

### [How Does the 'Reporting Threshold' for Block Trades Affect Market Transparency?](https://learn.greeks.live/path/how-does-the-reporting-threshold-for-block-trades-affect-market-transparency/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Does the 'Reporting Threshold' for Block Trades Affect Market Transparency?](https://learn.greeks.live/wp-content/uploads/2025/10/Chrome-Finial-Intersection-Above-Neglected-Digital-Asset-Ledger-Reflecting-Market-Volatility.webp)

Delayed reporting of block trades protects against front-running and slippage but reduces immediate market transparency.

### [Can a Time-Lock Be Bypassed in an Emergency Situation?](https://learn.greeks.live/path/can-a-time-lock-be-bypassed-in-an-emergency-situation/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![Can a Time-Lock Be Bypassed in an Emergency Situation?](https://learn.greeks.live/wp-content/uploads/2025/10/Geometric-Interplay-of-Tokenized-Assets-and-Option-Payoff-Structures-in-Decentralized-Finance.webp)

A time-lock cannot be bypassed, but some protocols use a separate, highly-secured emergency stop function to pause operations in a crisis.

### [What Is the Relationship between a Flash Loan and Arbitrage in DeFi?](https://learn.greeks.live/path/what-is-the-relationship-between-a-flash-loan-and-arbitrage-in-defi/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is the Relationship between a Flash Loan and Arbitrage in DeFi?](https://learn.greeks.live/wp-content/uploads/2025/10/Symmetrical-Bifurcation-Involving-Teal-Actuator-Segments-Near-Mirroring-Reflective-Surfaces.webp)

Flash loans enable instant, large-scale arbitrage by providing uncollateralized capital to quickly equalize asset prices across DEXs.

### [What Is a "Recourse Loan" versus a "Non-Recourse Loan" in Finance?](https://learn.greeks.live/path/what-is-a-recourse-loan-versus-a-non-recourse-loan-in-finance/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is a "Recourse Loan" versus a "Non-Recourse Loan" in Finance?](https://learn.greeks.live/wp-content/uploads/2025/10/Asymmetrical-Balance-of-Digital-Asset-Execution-Versus-Volatility-Surface-Contraction-in-DeFi-Protocols.webp)

Recourse allows the lender to seize personal assets; non-recourse limits the claim only to the collateral provided.

### [What Is a "Flash Loan" and How Does It Exploit Composability?](https://learn.greeks.live/path/what-is-a-flash-loan-and-how-does-it-exploit-composability/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is a "Flash Loan" and How Does It Exploit Composability?](https://learn.greeks.live/wp-content/uploads/2025/10/Black-Textured-Electronic-Module-with-Indicator-Array-Representing-DeFi-Liquidity-Pool-Ratios.webp)

An uncollateralized loan borrowed and repaid in a single transaction, exploiting composability for instant arbitrage or liquidation.

### [How Does the Interest Rate on an NFT Loan Compare to a Fungible Token Loan?](https://learn.greeks.live/path/how-does-the-interest-rate-on-an-nft-loan-compare-to-a-fungible-token-loan/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Does the Interest Rate on an NFT Loan Compare to a Fungible Token Loan?](https://learn.greeks.live/wp-content/uploads/2025/10/Interlocking-Digital-Ledger-Segments-Representing-Atomic-Swap-Settlement-Mechanisms-in-Decentralized-Finance.webp)

NFT loan interest rates are higher due to the increased risk from the illiquidity and subjective valuation of the unique collateral.

### [What Is a "Re-Entrancy Attack" and How Does It Relate to Flash Loans?](https://learn.greeks.live/path/what-is-a-re-entrancy-attack-and-how-does-it-relate-to-flash-loans/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is a "Re-Entrancy Attack" and How Does It Relate to Flash Loans?](https://learn.greeks.live/wp-content/uploads/2025/10/Internal-Mechanics-of-Automated-Market-Maker-Liquidity-Provision-Mechanism-Synchronization.webp)

An attack where an external call recursively calls back into the original contract; flash loans can provide the capital to trigger such an exploit.

### [How Does a Time-Weighted Average Price (TWAP) Oracle Mitigate Flash Loan Attacks?](https://learn.greeks.live/path/how-does-a-time-weighted-average-price-twap-oracle-mitigate-flash-loan-attacks/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Does a Time-Weighted Average Price (TWAP) Oracle Mitigate Flash Loan Attacks?](https://learn.greeks.live/wp-content/uploads/2025/10/Decentralized-Ledger-Integrity-Versus-Volatility-Convergence-in-Digital-Asset-Hedging-Strategies.webp)

It averages the price over time, ignoring the temporary, single-block price spikes caused by a flash loan attack.

### [How Does a Flash Loan Facilitate an Oracle Manipulation Attack on a DeFi Protocol?](https://learn.greeks.live/path/how-does-a-flash-loan-facilitate-an-oracle-manipulation-attack-on-a-defi-protocol/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Does a Flash Loan Facilitate an Oracle Manipulation Attack on a DeFi Protocol?](https://learn.greeks.live/wp-content/uploads/2025/10/Deconstructed-Spherical-Mechanism-Illustrating-Concentric-Layering-of-Decentralized-Exchange-Order-Book-Dynamics.webp)

Provides massive capital for a single-transaction trade to temporarily manipulate an oracle's spot price source before repaying the loan.

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**Original URL:** https://learn.greeks.live/learn/can-a-deviation-threshold-be-bypassed-by-a-flash-loan-attack/
